Physical Unit

It refers to e.g. quantity, weight, length, or square measure necessary to create one upper-level (parent) item. Since this is the information determined by the connection between upper-level items and lower-level ones, it is usually set in Product Structure Master which is used to express a Bill of Materials. It is also called i.e. just simply "number" and is used to calculate requirements, the quantity of goods taken out of a warehouse, and etc. The quantity demanded by each item is calculated by multiplying the quantity required by upper-level item(s) by the physical unit of the item. The physical unit is also used to make the use of inventory which has not moved for a long time. This is the method to calculate the quantity of upper-level items which can be produced by dividing the quantity of lower-level item's inventory by the physical unit.

Related term: Calculating Requirements